Truss Trumpets Growth But Markets Shrug

Liz Truss said she would make the “difficult but necessary” choices to get economic growth, but was heckled by environmental campaigners during her first conference speech as Tory leader.

The prime minister promised to steer the country through the “tempest” and “get Britain moving”.

Greenpeace protesters holding a flag which read “who voted for this?” were ejected from the hall after disrupting the speech, with Truss ordering security officers to “get them removed”.

Environmental campaigners were identified by Truss as “enemies of enterprise” as part of an “anti-growth coalition” including opposition parties, trade unions and “Brexit-deniers”.

The interruption to her speech in Birmingham followed a bruising conference for Truss after just a month in the job, including a U-turn over a totemic tax policy and dissent within her Cabinet.

Pound Weaker Today, Gilt Yields Higher

Despite the decision to ditch plans to scrap the 45 pence top rate of tax, Truss insisted “we must stay the course” in pursuit of her three priorities: “Growth, growth and growth.” The pound, having rallied from $1.11 to $1.15 over the last few days, has weakened today, and is worth $1.13 in early afternoon on Tuesday. UK gilt yields are higher today, with the 10-year year government bond back above 4%.

She told the audience: “This mission will be difficult but necessary. We have no alternative if we want to get our economy growing again.

“I am ready to make hard choices. You can trust me to do what it takes.

“The status quo is not an option. That is why we cannot give into the voices of decline.”

Setting out her vision, she said: “Growth means more money in people’s pockets and for businesses creating jobs.

“Growth means people can feel secure and plan for their future. Fundamentally, it enables people to fulfil their hopes and dreams.”

In a sign of support for Kwasi Kwarteng following the humiliation of the 45p U-turn, Truss said she was “in lockstep” with her “dynamic” chancellor.

She said: “Cutting taxes is the right thing to do morally and economically.

“Morally, because the state does not spend its own money. It spends the people’s.

“Economically, because if people keep more of their own money, they are inspired to do more of what they do best.”

A low tax economy was a sign that “Britain is open for business”, she said.

But in an attempt to calm markets which had been spooked by Kwarteng’s mini-budget, Truss promised to “keep an iron grip on the nation’s finances”.

“I believe in sound money and the lean state,” she said.

“I remember my shock opening my first paycheque to see how much money the taxman had taken out. I know this feeling is replicated across the country.

“That is why we must always be careful with taxpayers’ money.”

Bank of England Namechecked

Rising interest rates risk causing misery for homeowners, but Truss stressed the independence of the Bank of England over that. (See our article on Bank of England independence.)

But she said “the chancellor and the governor will keep closely co-ordinating our monetary and fiscal policy”.

She also promised reforms to slash red tape, promising: “Now is the time to harness the power of free enterprise to transform our country and ensure our best days lie ahead.”

In a message to the public, she said “we have your back” and she was working “flat out to ensure people can get through this crisis”.

She said the death of the Queen and the succession of the King heralded a “new era”, but warned: “These are stormy days.”

Truss added: “We’re dealing with the global economic crisis caused by Covid and by (Vladimir) Putin’s appalling war in Ukraine.

“In these tough times, we need to step up. I’m determined to get Britain moving, to get us through the tempest and put us on a stronger footing as a nation.”

More Unpopular than Corbyn

But in a sign of the difficulties she faces, shortly ahead of her speech YouGov released polling suggesting Truss is already more unpopular than her predecessor Boris Johnson or former Labour leader Jeremy Corbyn ever were.

Just 14% of the public now say they have a favourable impression of the prime minister compared with 26% who said so between September 21-22.

Nearly three-quarters – 73% – now see the prime minister in an unfavourable light, including more than half – 55% – who see her very unfavourably.

In response to the speech, shadow chancellor Rachel Reeves said: “The Tory economic crisis we are facing was made in Downing Street, paid for by working people facing higher mortgages and soaring costs.

“Liz Truss has been a government minister for the last 10 years. She has been at the heart of building a Conservative economy that has led to the flat wages and low growth she highlighted today.”

Liberal Democrat leader Ed Davey said: “The Conservatives have lost control of the economy, causing eye-watering mortgage payments, soaring inflation and an ever-deepening cost-of-living emergency.”